As we approach retirement season at the ASRS, we wanted to take this opportunity to highlight the importance of the Ending Payroll Verification (EPV) form. There are four scenarios when an EPV form is required from an employer:
1. A member applied for a refund of their contributions and had contributions reported by your organization in the last 6 months, or
2. A member is retiring and has had contributions reported by your organization in the last 3 years, or
3. A member passed away and
a. had contributions reported by your organization in the last 6 months, or
b. had reached the Required Minimum Distribution age before passing, or
4. A member is refunding or retiring after reaching the Required Minimum Distribution age.
By completing the EPV form, you confirm a member's last day of membership or termination date and, where necessary, provide details of their final pay. Employers can access a detailed EPV guide, which provides instructions and information about the form. You can find it on our website at this link: Online Ending Payroll Verification Guide - October 2023.
Here are key aspects to consider when completing the EPV form:
Last Day of Membership vs. Termination Date
For members who are retiring, these dates are crucial for processing retirement benefits and compliance with Return to Work rules. Please be mindful of the differences between the two fields on the form and only complete the applicable field.
Last Day of Membership: This is the date before an employee reduces their hours to fall below the membership criteria. You only complete this field if the employee chose to retire without terminating employment. Keep in mind, members can only do this if they have met normal retirement criteria and are choosing to reduce their hours to fall below the membership criteria. Retiring without terminating will restrict the retiree from ever returning to a membership-eligible position, also sometimes referred to as a 20/20 position, wherein they’re engaged to work at least 20 hours a week for at least 20 weeks in a fiscal year. To accept a membership-eligible position without impacting their retirement pension, retirees must terminate employment and wait 365 days before accepting a 20/20 position with an ASRS employer.
Note: This only applies if the employee is retiring without terminating employment.
Termination Date: This is the last paid date or the last day the employee worked. We encourage workers to coordinate with their employers when possible to ensure their termination date and their effective retirement date are not in conflict. For example, a teacher retires with an effective date of May 24, 2025, after the last day of school. If the employer uses the end-of-contract date of June 30, 2025, on the EPV, instead of the last day of school, the member’s effective retirement date will be changed to July 1, 2025, which can cause an overpayment issue. If the teacher received any estimated payments for May and June, those payments will need to be returned to the ASRS or deducted from the retiree’s first calculated retirement benefit.
Amending EPV Forms
Employers can view and amend EPVs submitted within the past 12 months through the ASRS online system. The specific steps for accessing this information can be found in the EPV guide. You can amend an EPV for such things as an incorrect termination date or correcting final salary amounts. When an EPV form needs to be amended, employers should also submit an Employer Secure Message (ESM) through the ASRS online portal. This ensures that the changes are properly documented and processed.
Required Minimum Distribution (RMD)
A required minimum distribution (RMD) is the annual minimum amount a taxpayer must withdraw from a tax-deferred retirement plan starting at an age specified by the Internal Revenue Service (IRS). This is a requirement mandated by the IRS to prevent tax-deferred retirement savings from being held indefinitely. This sometimes necessitates that we inquire about employees who may not have worked for you for quite some time.
If a member of the ASRS stops actively contributing, leaves funds on account, but never applies for pension benefits or a refund, they’re considered an “inactive member.” The ASRS begins mailing annual notices to these inactive members soon after their 65th birthday to alert them that they still have funds with the ASRS. If the inactive member then submits a retirement or refund application to the ASRS, an EPV is generated to the last employer who remitted contributions, regardless of how long ago those contributions were submitted. RMDs apply even if the employee hasn't worked for you in many years but still has funds in the system.
If you no longer have employment records for the member back to that time, please include comments on the EPV that employment records are no longer available, and if possible, provide the last known work date or contact the ASRS for assistance with the last contribution reported date, and submit the EPV to the ASRS.
Timely Submission
Members submit applications for refunds or retirements with an expectation of receiving their funds or having their retirement calculated in a timely manner. We do advise our members that the turnaround times we quote to them are contingent on receiving all required documents. Most of the required documents are the member’s responsibility, but the Ending Payroll Verification form is the employer’s sole responsibility in this process. Your prompt submission of the EPV and responses to any questions from our benefits processing team go a long way in ensuring a smooth and timely experience for our members during these important transitions.
